Signaling in markets with two-sided adverse selection

Authors
Gale, D
Citation
D. Gale, Signaling in markets with two-sided adverse selection, ECON THEORY, 18(2), 2001, pp. 391-414
Citations number
30
Categorie Soggetti
Economics
Journal title
ECONOMIC THEORY
ISSN journal
09382259 → ACNP
Volume
18
Issue
2
Year of publication
2001
Pages
391 - 414
Database
ISI
SICI code
0938-2259(200109)18:2<391:SIMWTA>2.0.ZU;2-E
Abstract
The paper analyzes an economy with two-sided adverse selection, focusing on equilibria that satisfy a refinement based on the notion of strategic stab ility. In the familiar case of one-sided adverse selection, agents reveal a ll of their private information as long as the contract space is rich enoug h. However, with two-sided adverse selection, the sufficient conditions for separation are much stronger.